A Greedy Approach and its Limitations for Day-ahead Co-allocation of Energy and Reserves

In this paper we consider a multi-zonal day-ahead market clearing setting, in which energy and reserves are simultaneously allocated. We present an iterative heuristic approach for the joint procurement process, which is based on the greedy algorithm. We demonstrate via an example that this simple approach cannot be expected to reach global optimum in general and discuss its further improvement possibilities.